Eni Oil & Gas Co Responds To Energy Crisis With $2.6 Bln Profit

COMMODITIES(B-Trams):Despite its fourth-quarter results missing estimates,Eni oil & gas company made a record annual profit as a result of high oil and gas prices.

After Russia’s invasion of Ukraine caused the value of key commodities to soar, the Italian energy giant outperformed its peers with stellar earnings for 2022. Even though the price of energy has gone down in recent months, the conflict poses a threat of lasting change that could keep prices high for years.

The average analyst estimate of €2.6 billion was not met by Eni’s adjusted net income of €2.5 billion ($2.6 billion) in the fourth quarter. It was a record amount of €13.3 billion for the entire year.

Claudio Descalzi, CEO of Eni, stated in a statement on Thursday that the company’s response to the energy crisis was an “important driver” of the gas business’ performance.

Eni oil & gas company replaced Russian supplies with those from other sources, which resulted in the gas business earning €2.1 billion before interest and taxes during the year. According to a note from Equita analyst Gianmarco Bonacina, the gas business’s performance was the biggest positive surprise, and corporate costs were also lower than anticipated.

Eni has pledged to increase Italy’s energy security over the next few years by securing gas supplies from Africa to take the place of Russian imports. Due to unplanned outages, the company’s oil and gas production for the year fell short of its goal of 1.7 million barrels per day.

Biraj Borkhataria, an analyst at RBC Capital Markets, stated that the upstream results were disappointing. As of 10:09 a.m. in Milan, the shares of the company were 13.93 euros, or 1.3% lower.

Eni’s oil & gas company business strategy for the years 2023 to 2026 will be presented to investors later on Thursday, with the possibility of additional share buybacks at the forefront.

In a note, Santander CIB analyst Jason Kenney stated, “Eni has room to raise average capital spending, and either way, we see room for cash returns upside.”